Solar

ATS Automation to Spin Off its Solar Businesses

With demand for solar energy at all-time highs and prices for the technology drawing top dollar around the world, Canada’s ATS Automation Tooling Systems Inc. revealed plans this week to spin off its solar energy assets later this year in an IPO that would include a range of solar technologies.

The company’s board of directors decided to pursue an IPO of the common shares of a new subsidiary to be formed to hold the assets of the ATS Solar Group. The new subsidiary will be named Photowatt Technologies and is expected to include the company’s investments in Photowatt International (in France) and in Spheral Solar Power (SSP). “An IPO of Photowatt Technologies is the principal mandate approved by our Board of Directors,” said Ron Jutras, ATS President and Chief Executive Officer. “For that reason, we continue to aggressively prepare Photowatt Technologies for an IPO. However, at the same time, the Board has stated clearly that it is open to considering alternative transactions during this preparatory period. I believe this is a wise strategy that is in the best interests of our shareholders.” An offering of Photowatt Technologies shares is expected to take place in the third or fourth quarter of this year. Tyler Hamilton, a business and energy writer for the Toronto Star Newspaper and the Clean Break web log, said this could be a particularly exciting IPO as the ATS Solar Group has the benefit of both a conventional solar PV business through Photowatt and a next generation solar business in Spheral Solar Power (SSP), which is based on using less silicon than conventional technologies. Thin-film and other technologies that use little or no silicon have drawn considerable attention lately since they’re insulated from the silicon raw material shortage that has cramped the mainstream crystalline solar industry. “This will be an interesting one to watch, and no doubt analysts will be crunching the numbers tonight,” Hamilton wrote at Clean Break. “I imagine this IPO will attract a lot of interest from U.S. institutional investors wanting a piece of this Canadian solar play.” He added that some analysts estimate that a publicly spun off Photowatt Technologies could have a market capitalization of $1 billion, or maybe more, given the stunning rise in other solar stocks such as China’s Suntech and U.S.-based Sunpower Corp. In the meantime, ATS’s Jutras says the company will continue to press on with its conventional solar business in France through Photowatt. “In the meantime, our operational objective for Photowatt Technologies this year is to continue to pursue opportunities in conventional solar technology through Photowatt International in France and overcome the significant challenges and risks associated with proving out the commercial manufacturability of the new SSP products,” Jutras said. “With today’s announcement, we have a clear financing plan for Photowatt Technologies and a solid strategy to enable our shareholders to realize the value of this part of our company.”